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Taiwan inflation rate reaches highest level in 13 years

CPI still below 2% for 2021, but at 2.62% for month of December

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Inflation reached its highest rate since 2009, but still stayed below 2% for 2021. 

Inflation reached its highest rate since 2009, but still stayed below 2% for 2021.  (CNA photo)

TAIPEI (Taiwan News) — The rise in the Consumer Price Index (CPI) reached 1.96% in 2021, its highest level since 2009, but still below the psychological barrier of 2%, the government announced Thursday (Jan. 6).

The figure for December 2021 reached 2.62%, though the core inflation rate without the prices for fruit, vegetables, and energy amounted to 1.84%, according to the Directorate General of Budget, Accounting and Statistics (DGBAS).

Fruit prices surged by 21.61% in December, mostly as the result of adverse weather conditions, while eggs, meat, vegetables, and eating out also contributed to an overall 4.23% rise in food products, CNA reported. International oil prices and airline ticket fees forced a hike of 5.08% for the transportation and communication sector.

A basket of 17 key products showed a rise of 3.46% for 2021 compared to 2020, continuing an upward trend for Taiwan’s CPI, the DGBAS said. Nevertheless, another government department, the National Development Council (NDC), said most of Taiwan’s inflation was the result of imported factors, such as oil prices.

The expected reduction of international supply chain bottlenecks during 2022 would also contribute to a slowing down of inflationary trends, according to the NDC. The CPI growth rate for the new year is expected to stay below 2%, while moving in a range between 1.1% and 1.9% from month to month.